US Stock Futures Recover on China-US Trade Talks
US Stock Futures Recover on China-US Trade Talks
Equities
Major US indices bounced off a one-week low during the Asian session following the news that China and the US will hold vice-minister level trade talks on the 7th and 8th of January. The Dow Jones Industrial Average futures rose 0.7% to 22870, the S&P500 futures climbed 0.7% to 2470, and the Nasdaq futures added 1.2% to 6243. Lately, the global stock market was under pressure on signs of a global economic slowdown which curbed investors' risk appetite.
USD
The dollar index which measures the greenback against a basket of major currencies lost 0.5% to 96.23 on soft economic data. The December ISM manufacturing PMI dropped to 54.1 from 59.3 previous, the lowest in three years and the sharpest one-month drop since 2009. The soft economic data signals that the Fed will be forced to pause its monetary policy tightening cycle. The US 10-year yields fell to 2.541%, the lowest since mid-January 2018. Market participants await today's jobs report, mainly, the average earnings.
Metals
Metals prices edged higher as the dollar weakened along with treasury yields. The gold ounce rose to $1298, the highest in more than six months. Meanwhile, the silver ounce finished higher for the seventh consecutive day at $15.70, and palladium traded above $1270.
Oil
Oil prices surged on expectations that the OPEC+ cut agreement could lead to a stable market, and the trade talks between China and the United States would lead to a deal that will boost the global economy. The West Texas Intermediate crude futures traded near a two-week high of $47.75, and the Brent futures rose to a high of $56.66. Market participants await the crude oil inventories release later today.
Major Economic Events
| GMT | Country | Event | Expectation | Previous |
|---|---|---|---|---|
| 8:55 | EU | German Unemployment Change (Dec) | -12 | -16 |
| 9:30 | UK | Services PMI (Dec) | 50.7 | 50.4 |
| 10:00 | EU | CPI (YoY) (Dec) | 1.8% | 1.9% |
| 13:30 | US | Nonfarm Payrolls (Dec) | 178 | 155 |
| 13:30 | US | Unemployment Rate (Dec) | 3.7% | 3.7% |
| 13:30 | CA | Employment Change (Dec) | 6.8 | 94.1 |
| 13:30 | CA | Unemployment Rate (Dec) | 5.7% | 5.6% |
| 15:15 | US | Fed Chair Powell Speaks | ||
| 15:30 | US | Crude Oil Inventories | -3.086 | -0.046 |
| 18:00 | US | U.S. Baker Hughes Oil Rig Count | 885 |
Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM.COM. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.
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